As always, the data that follows is my interpretation of the market as of a snapshot in time. Please use your own judgement as to whether this makes sense and do your own research as opposed to relying on what I see. That noted, I put this out there for discussion.
In order to track the direction of a market over time, I considersed a year over year study of prices paid to be appropriate. As Chelsea is not a huge market, the appraisal looks at two separate market segments, that of the entire school district over time, and that of the newer houses over time.
In the first segment there are sufficient sales to show market direction with comfort. In this array of sales, there is a substantial decline in sales prices from year one through to year three of the study, with increases in median sales prices showing in the most recent two years prior to 2/28/2012. Sales prices overall are lower still than they were in the second period encompassing most of 2008, but up significantly since the 2009 period. In this market segment there has been an average of 149 sales per year or 12.40 sales per month. As there are currently 124 houses on the market, with 25 showing as under contract, the remaining 99 offerings would then be expected to absorb into the market in an 8-month period, which is considered reasonably balanced, in particular when considering 20% of the houses on the market are under contract.
In the second segment, I simply considered newer houses in Chelsea schools on one acre or less of land. These houses were narrowed in size from 1700 to 2800 sqft and built after 2000. There are far fewer sales in this narrowed segment, with the peak number of sales being in the 2008-09 market. The current listings do not include the new construction offerings as they are not built, but offerings to build and are therefore not really available to close and move into in a short time frame.
Looking at the newer houses there has been erratic behavior in prices, with a significant decline followed by a similar increase, followed by a decline. This is mainly due to having too few sales to accurately reflect the market, and therefore no weight is placed on this market segment. What is considered is the more recent number of sales and the current activity.In the past two years there have been an average of 8.5 sales per year in this market segment, and with only two active listings (a third is under contract)the remaining offers would be expected to be under contract in under 3-months’ time, indicating a shortage of current offerings in the immediate marketsegment.
Finally, not only the overall market and market segment should be considered, but the subject immediate subdivision over time.Both prices over time, and price per square foot over time were charted and this information mirrors the market in general with a sharp decline in prices noted until 2008, then lessening in 2009 and reaching stable in 2010 and showing a slight increase up over the past couple of years for overall prices. In the price per square foot (PPSF) chart, the market shows a decline and a recent leveling of prices but not an increase. See charts below.
Comments(0)